How to Put a Bill on Global Trade Wars

Every time you get to the checkout line, the total on the bottom of the receipt tells a frustrating story.

We’ve been hearing about inflation cooling for months, yet your favorite brands are still raising prices. If you’re wondering why the numbers don’t add up, you’re not alone.

The truth is, businesses are made to play well. For a while, they try to squeeze prices before the holidays to keep us coming back.

Now? They pass their rising costs directly on to you, and a large portion of those costs come from later costs.

The end of the company’s patience

We are seeing a significant change in the way companies handle their debt. According to a recent report from the Wall Street Journal, businesses large and small are issuing “high-end” pricing increases.

Whether it’s clothing companies like Levi Strauss, spice makers like McCormick or car manufacturers like BMW, companies are reaching the top. They prioritize their profit margins over your loyalty.

If you think inflation means lower prices, I hate to be the bearer of bad news. Inflation measures the rate at which prices rise.

Although it has dropped from 9% a few years ago to about 2.4% this January, rates are still rising.

Inflation – inflation – is not deflation. For prices to truly come down, the economy has to stop, and trust me, you don’t want the chaos that comes with that.

Who really pays the prices

Here’s a financial myth I like to explain: Politicians like to say that foreign countries and businesses pay taxes. That is not true now, and it never has been.

When the government imposes tariffs on imported goods, the exporter does not simply absorb the costs. They pass it down the supply chain until it lands squarely in your lap.

Don’t just take my word for it. Independent data makes this brutally clear:

• 96% truth: A recent study by the Kiel Institute for the World Economy analyzed $4 trillion in exports and found that American consumers and businesses pay 96% of the cost of recent US tariffs. Exporters absorb 4%. That means that $200 billion in tax revenue collected by the government last year wasn’t paid by foreign countries — it was actually a consumption tax taken directly out of your wallet.
• Fed warning: The Federal Reserve Bank of New York recently released a report that shows that US consumers and firms will pay about 90% of the costs of the 2025, the burden finally falls on consumers.
• Home team: The nonpartisan Tax Foundation estimates that these trade policies cost the average American family about $1,000 last year. If things don’t change, that number is expected to jump to $1,300 by 2026.

(See “Here’s How Much Taxes Cost Americans Last Year – and What to Expect in 2026.”)

The fallacy of shrinkflation

Sellers are becoming more aggressive in the way they hide these mountains. You may have noticed inflation – where a bag of chips stays the same price but holds less than before.

Or perhaps skimpflation, where the quality of service or ingredients declines while the price remains firm.

Either way, you get less for your money.

(See “Are Your Tic Tacs Really Depreciating? How Depreciation and Depreciation Go Together.”)

How to fight

You don’t have to just sit there and take it. While you can’t control international trade policy, you can control where your money goes.

• 1. Check your invisible usage: Check your recurring subscriptions and automatic reorders. These are places where price creep can happen without realizing it.
• 2. Reduce brand loyalty: If your favorite detergent or jeans are on sale, it’s time to shop. In many cases, conventional alternatives offer the exact same quality, but you don’t pay for the fancy marketing or tax markup.
• 3. Buy by unit price: Don’t look at the final price tag. Look for the small print on the shelf that lists the price per ounce. Comparing unit prices across different brands and sizes is an easy way to beat the odds. (See “Cut Your Food Bill by Hundreds of Dollars With This One Small Change.”)
• 4. Time your big walk: If you’re planning to buy a large item like a car or machine that relies on imported parts, do your homework now. With supply chain shifts and ongoing trade disputes, the price you see today may be the lowest you’ll see for a while. (See “9 Ways to Avoid Price Inflation.”)

The bottom line is simple: No one is coming to save your budget. You have to be your own advocate.

Keep your eyes on receipts, always question political promises and don’t be afraid to walk away when the price doesn’t match the value.